NGX market CAP quivers as 11 Plc offloads N82.22bn by delisting
The aggregate valuation of equities at the Nigerian Exchange Limited took a negative direction on Friday despite a 0.21 per cent rise in the All-share Index (ASI), the market’s benchmark tracker of share prices, at the close of the session.
The contrasting experience was occasioned by the exit of 11 Plc (formerly Mobil Oil Nigeria Limited) from the capital market.
Management of the bourse informed the market and investing public that the entire shares of 11 Plc were delisted from The Daily Official List of the Nigerian Exchange Limited (the Exchange) on Friday, 7 May 2021.
The delisting of the entire issued share capital of 11 Plc followed its shareholders’ approval to delist from the Exchange and the eventually execution of the consensus offloaded some cash from the aggregate value of the equities market.
As such, at the close of trading on Friday May 7, 2021, the NSEA ASI closed positive with +0.21 per cent gain while Market CAP moved in the opposite direction with -0.19 per cent loss which represents about N39.05 billion drop in Market CAP from N20.47 trillion on Thursday May 6, 2021 to N20.43 trillion on Friday.
As at the closing of trading on Friday when the shares of 11 Plc were delisted , its market CAP stood at N82.22 billion.
It is pertinent to reiterate that the delisting of the 360.59 million units of shares of the company that made up the amount led to the negative closure and drop recorded in Market CAP on the last trading day of the week.
On the Delisting
In a public notice dated April 19, Chris-Olumayowa Meseko, the company secretary of 11 Plc informed the public of progress on the voluntary delisting plan of the company.
He said, “Further to the application made to The Exchange by 11 Plc on the Voluntary Delisting of the Company from The Exchange as recommended by the Board of Directors, the Exchange approved the delisting application subject to 11 Plc’s evidence of opening an escrow account in the Registrars name and evidence that shareholders who have accepted to exit have been paid.
“Subsequently, Il Plc has opened an escrow account with Greenwich Registrars and Data Solutions Limited and provided sufficient funds to shareholders, who as of March 15, 2021, have accepted the Exit Consideration of N213.90 per share based on the highest price of N213.90 at which 11 Plc traded in the last 6 months preceding the date of the Annual General Meeting (AGM) where the resolution to delist was passed in line with NSE guidelines.”
Rationale behind delisting
According to the scribe of the company, the delisting provides the company with the opportunity to strategize for better performance, minimize costs, and stay competitive within its industry.
Background on 11 Plc
11 Plc, formerly Mobil Oil Nigeria Plc, is a Nigeria-based petroleum products marketer.
The Company has two segments: Petroleum Products Marketing and Property Business. The Petroleum Products Marketing segment generates revenue from the sale of white products and lubricants.
The Property Business segment generates income from the rent paid on its investment properties and service stations; and income from recently acquired Lagos Continental Hotels.
The Company’s petroleum products include petrol, diesel, aviation fuel, kerosene and lubricants. Petrol, diesel and kerosene are sold through its service stations while lubricants are sold through both the service station and the Company’s distributors.
Aviation fuel is sold at Murtala Muhammed Airport, Lagos. The Company has approximately 250 retail outlets located across the Country. The Company operates a Lube Oil Blending Plant (LOBP) in a state of the art facility located in Apapa, Lagos State.